Emergency Mgmt. Director Resigns After Scathing Audit

FRANKFORT, Ky. -- Kentucky's emergency management chief resigned Thursday after a blistering review said those within his agency wasted taxpayer money, intimidated employees and created a hostile work environment.

Brigadier General John Heltzel

Credit wfpl.org

Gov. Steve Beshear said he accepted John Heltzel's resignation Thursday morning, two days after state Auditor Adam Edelen released findings that found $5.6 million in questionable spending in recent years, some of it on alcohol, entertainment and door prizes at conferences.

"The findings in the recent auditor's report made it clear that new leadership was needed in the agency," Beshear said, "given the numerous questions and grave concerns it raised about the proper handling of funds, reliable and transparent accounting, and appropriate work environment."

Edelen said his staffers who conducted the review found instances of documents being altered to hide inappropriate expenditures.

"The report paints a picture of agency leadership that does not believe the rules apply to it," Edelen said when he released the findings. "The findings raise concerns about waste and abuse that may have gone undetected and jeopardize federal funding meant to prepare the commonwealth for emergencies."

Heltzel, a retired Kentucky National Guard brigadier general, disputed the auditor's findings, which were turned over to the U.S. Office of Homeland Security, the Kentucky attorney general's office and the Kentucky Executive Branch Ethics Commission. In a written response, the agency said taxpayer money has not been misused and that no employees have been intimidated, though they do work in an intense environment during natural disasters.

Edelen said several employees reported being afraid to communicate with auditors on their office phones, through email, or in person at their desks because they believed their phones and offices were bugged and their emails were being read.

As auditors were wrapping up the exam, Edelen said some of the employees told the team that they were threatened with retaliation for talking with his staff, which, if true, would be a violation of the state's whistle-blower law.

Edelen said his staffers found spending on conferences held in 2010, 2011 and 2012 that didn't appear reasonable or necessary. At least $103,000 in taxpayer money was spent on entertainment, including a riverboat cruise, after-hours receptions, meals, alcohol, door prizes and gifts.

The agency spent $113,000 on lunches at a Frankfort hotel between 2009 and 2013. Auditors questioned the necessity of those expenditures and noted that many of the meals exceeded the state's maximum per day allowance.

Beshear appointed Mike Jones, an administrative officer in the Department of Military Affairs, as the acting emergency management director. Beshear said his first task will be to creative a corrective action plan for the agency and to implement that plan.

"The public's trust is a sacred investment that we all must safeguard, and this change in leadership will help to restore accountability and transparency to this critical agency," Beshear said.